Since industrial and manufacturing companies use close to a third of all the energy consumed in the US each year, managing that energy is becoming a core business concern.
This bodes well for cleantech companies that specialize in providing industrial energy management software and services. The U.S. market for these services will rise from $960 million in 2011 to $5.6 billion by 2020, a compound annual growth rate (CAGR) of 21.6%, according to Pike Research.
No longer cheap the way it was decades ago, energy is now considered a critical input to industrial processes and many companies are already using energy management products and services.
Energy management software tracks and monitors where energy is used in manufacturing processes and identifies ways to reduce it and control costs. It also facilitates greenhouse gas reporting by benchmarking energy use and tracking improvements.
U.S. industries must go further, however, to remain cost-competitive globally. Facing high price volatility and stiff global competition for market share, companies are finally coming to the realization that energy and sustainability issues are a critical requirement for the competitiveness and even survival of their businesses.
“The energy management industry is entering a dynamic period of renewal and innovation,” says Bob Gohn, VP at Pike. “New technologies are allowing greater insight into energy procurement and use, as well as the management of energy as an input to the industrial process. At the same time, a variety of assistance programs, plus new standards and certifications, are helping to drive energy performance initiatives into the organizational cultures of companies wishing to gain efficiencies in their industrial processes.”
The economic recovery and increased scrutiny by shareholders are also facilitating attention to energy management. Just as quality was a major competitive issue in the 1980s and 1990s, so is energy management today.
The same is true for the Internet giants such as Facebook and Amazon, which will be confronted by a barrage of energy and carbon emissions challenges, related to explosive energy consumption trends. They not only face price volatility and its impact on financial results, but also public criticism of sustainability commitments.
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